IAG Boss Blames UK Government for Failing to Attract Chinese Tourists

Nathalie Thomas, The Daily Telegraph

- Sep 23, 2013 7:01 am

Skift Take

The UK lacks a comprehensive long-term plan that reflects the realities of today’s shifting tourism economy. Outside of hosting global events, the UK’s competitiveness continues to shrink due to air taxes and stringent visa rules.

— Samantha Shankman

Share

Tweet

Share

Post

Send

David Cameron and George Osborne “lack vision” in how to grow the UK economy, said IAG chief Willie Walsh, as the airline blamed Britain’s “bureaucratic” visa regime for delaying the launch of a new route to one of China’s biggest industrial centers.

In a blistering attack on the Conservative leadership less than a week before the party’s conference in Manchester, the head of British Airways’ parent company accused the Prime Minister and the Chancellor of failing to set out a long-term growth plan for the UK economy and only responding to “topical” events.

Mr Walsh, chief executive of International Airlines Group, said BA would likely have launched a new air route linking Britain directly with Chengdu – a major centre for pharmaceutical, automotive and aerospace industries – 12 months earlier if Britain’s stringent visa regime for Chinese tourists and business people was more on a par with that of its European rivals.

Britain’s bureaucratic visa rules give tourists and business people from the world’s second biggest economy the impression that the UK doesn’t want their trade, Mr Walsh warned.

British Airways on Sunday launched weekly direct flights between London and Chengdu, its first new destination in China since 2005.

Chinese visitors to Britain are required to have their finger prints taken and pay more than for a Schengen visa, which gives access to 26 European countries but not the UK.

Unlike rival European countries, the UK also dictates that Chinese air travellers have to secure a visa even if they are only transferring on to another flight at Heathrow airport, Mr Walsh said.

Airlines such as BA use transfer traffic to help fill flights and make new routes economically viable but the UK’s visa rules mean business is being driven to rival European airports such as Amsterdam and Frankfurt.

“There is a perception in China that the UK doesn’t want to see Chinese tourists and business,” Mr Walsh said.

“The [UK] Government talks a good talk about wanting to do business with China but if they are going to translate that into the real opportunity that exists then they are going to have to look at the issue.”

Mr Walsh said large groups of Chinese tourists on organised tours are avoiding coming to Britain altogether and are instead taking their business to competitor economies such as France.

“What we are losing out on at the moment are the organised tour groups which typically go to Europe and bypass the UK as it is too much hassle to apply for two visas,” the aviation industry veteran said, although he did concede some improvements have been made by the Home Office in the last 12 months.

The head of IAG, which is a constituent of the FTSE 100, highlighted the problem with visas for Chinese travellers as one example of how the Government has been lacking “visionary leadership” when it comes to expanding the UK economy.

“I’m not a fan of Cameron nor of Osborne,” Mr Walsh said. “I have no political affiliation but I haven’t seen much evidence of visionary leadership there.

“To me they respond to whatever is topical rather than setting out a long-term plan and long-term vision for growth,” he said.

A year-long delay in the launch of a route to a key industrial city such as Chengdu is likely to have cost Britain dear in missed tourism and trade.

Chengdu, the capital of Sichuan province, has been undergoing rapid growth. In 2005, 12 million passengers flew from its airport to destinations around the world, but that has increased to 32m in just eight years.

According to VistBritain, Chengdu is now the fastest-growing market in terms of Chinese tourists applying to come to the UK.

However, it is only the fourth city in Greater China to be served from Heathrow. Britain’s UK hub airport, which is operating at full capacity, is lagging behind European rivals such as Amsterdam and Frankfurt in offering direct flights to cities in Greater China. Amsterdam offers non-stop flights to six cities in Greater China while Frankfurt is connected to five key regions in the rising Dragon economy.

Take Your Airline Understanding to the Next Level: Subscribe to Skift Airline Weekly

Photo Credit: A British Airways Airbus A380 taxis after landing at the Le Bourget airport near Paris, one day before the start of the 50th Paris Air Show, June 16, 2013. The Paris Air Show runs from June 17 to 23. Pascal Rossignol / Reuters